OBR Rebuffs Cameron Over Misleading Remarks

The Office for Budget Responsibility (OBR) has criticised Prime Minister David Cameron for misrepresenting its position on the impact of measures aimed at cutting the national debt.

The Office for Budget Responsibility (OBR) has criticised Prime Minister David Cameron for misrepresenting its position on the impact of measures aimed at cutting the national debt.

In a speech on Thursday, Cameron said the economy had been hurt not by the government's deficit-cutting agenda but by problems in the euro zone and higher oil prices - a view he claimed OBR endorsed.

That, said OBR Chairman Robert Chote, was untrue.

"It is important to point out that every forecast published by the OBR since the June 2010 Budget has incorporated the widely held assumption that tax increases and spending cuts reduce economic growth," Chote wrote in an open letter published on Friday.

The rebuke is embarrassing for the government which set up the watchdog shortly after it came to power in May 2010. The government uses the OBR's projections as the basis for its budget planning and has made much of the credibility of its forecasts.

Chote's letter marks the first public clash between the watchdog and the prime minister, and will be seized upon by critics who blame the government's spending cuts and tax hikes agenda for the country's economic woes.

Britain is perilously close to tipping into its third recession in four years and was stripped of its triple A credit rating by Moody's last month.